Why Understanding Attorney Malpractice Insurance Policy Declaration Page is Important.
Written by Kyla Nielsen
Understand the declaration page of your malpractice insurance can be challenging. This article will help break down one very significant part of your policy listed on the declaration page of your attorney malpractice insurance policy: your limits.
If you look at your declaration page, you will see there are two different limits of liability listed: Each Claim and Aggregate. The differences between these two limits are very significant.
Each Claim Limit
Let’s start with the Each Claim limit. This limit may appear differently on different policies; some might call it “Per Claim” or “Per Occurrence” or another variation. Regardless of the title, they all pertain to the same limit. This limit indicates how much your malpractice insurance policy will pay per individual claim. For example, if your “each claim” limit is $500,000 and you have a claim come in, the most your policy will pay for that particular claim is $500,000.
Your Aggregate limit is the total amount that your policy will pay out in the policy period. For example, if you have a million-dollar aggregate limit and you have four claims during your policy period that total a million dollars and you get a fifth claim, your policy would not pay for that claim because you have already reached your aggregate limit.
Why These Matter
It is important to assess the type of law you practice and understand the risk that it entails. There are some areas of law that are inherently higher risk, in these cases, as well as if you are a larger law firm, carrying higher limits on your malpractice insurance policy is a good idea.
Understanding the key parts of your policy is extremely important but can be a bit confusing. To review, each claim limit is the amount your policy will pay on one single claim in the policy period. The Aggregate limit is the total your policy will pay on all claims in the policy period.
How We Can Help
At NPIS we not only make sure you have the right legal malpractice insurance we make sure you understand your coverage. Have questions about your policy? Give us a call. We will help you even if you are not our client.
Our business is protecting your business!